Grains trading outlook: wheat, corn, soybeans futures at multi-year lows as US crop outlook improves

Wheat, corn and soybeans futures were higher during early trade in Europe today, after sliding to multi-year lows on Monday, with the US weekly crop report boosting production outlooks.

Weather patterns project several hot days for the Midwest, with enough showers to keep adequate soil moisture for growing crops. The southern Plains will also see heat over the following few days, though rains will be limited there, stressing growing crops, while the northern Plains will see some thunderstorms and plenty moisture.

“Rains are spreading across the continent this week and will be followed by another rain event early next week, keeping wetness a threat to crop quality and resulting in more feed wheat,” Commodity Weather Group said.

The US Department of Agricultures statistics arm, the National Agriculture Statistics Service (NASS), posted weekly crops readings on Monday, revealing improving shape and steady growth across all grains.

“Grain futures are higher on bargain hunting in technically oversold markets,” Paul Georgy, the president of Allendale Inc., wrote in a market comment today, cited by Bloomberg.

Wheat

Wheat futures for September delivery on the Chicago Board of Trade (CBOT) stood at $5.312 per bushel at 9:42 GMT today, up 0.24%. Prices ranged from $5.292 to 5.350 per bushel. The contract dropped 0.42% on Monday, reaching a four-year low of $5.236 per bushel, and has lost more than 13% over the past two weeks.

The NASS reported winter wheat harvest was progressing well, with 75% of crops collected by July 20, on par with the 5-year average for the week.

Meanwhile, 80% of spring wheat crops were reported in good or excellent condition, standing slightly higher than last years reading for the week.

Corn

Corn December contracts on the CBOT stood at $3.730 per bushel, adding 0.27%. Daily price range was at $3.710 – 3.734 per bushel. The contract dropped 1.72% on Monday, reaching a four-year low of $3.704 per bushel. Corn prices have lost more than 20% over the past month, as US crops outlooks improve.

“The corn has been outstanding for a long time,” Mike Seery, president of Seery Futures in Plainfield, Illinois, said for Bloomberg. “It’s healthy as a horse. Soybeans were very small about a week ago, and they’ve doubled or tripled in some areas. The weather has just been so phenomenal that it’s difficult to have a big rally.”

Mondays report logged that 76% of corn crops were in good or excellent condition, same as last week and quite higher than the 63% from the same week last year.

Soybeans

Soybeans futures due in November were at $10.070 per bushel, down 0.14%. Prices ranged from $10.664 to 10.760 per bushel. The contract was closed for a 1.27% loss on Monday, reaching a 2.1/2-year low of $10.654 per bushel, and is down some 20% for the past month.

Soybeans crops progressed well, according to the NASS log, with 73% reported in good or excellent condition, adding 1% to last weeks reading and standing 9% above last years figure. Meanwhile, pods setting and blooming were also ahead of their respective 5-year averages.

Technical view

According to Binary Tribune’s daily analysis, wheat for September delivery on the CBOT will see its first resistance level at $5.430. If breached, the contract will advance to $5.484 and then to $5.578 per bushel. The first support points is estimated at $5.282. Should it be broken, wheat will test $5.188 and after that $5.134 per bushel.

Corn for December will have its first resistance at $3.915 and if it broken the contract will advance first to $3.949 and then to $4.005 per bushel. The first support level is calculated at $3.825. Should the contract breach that, it will probably continue down to $3.769. If both previous supports are penetrated corn will test $3.735 per bushel.

Soybeans for November have the front resistance level estimated at $10.951. If the contract manages to pass the first level, next resistance is expected at $11.043 and then $11.177 per bushel. Meanwhile, support is expected at $10.729, $10.595 and $10.505 per bushel.